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tv   Fast Money  CNBC  December 2, 2016 5:00pm-5:31pm EST

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have a good weekend. >> good luck with the blackberry. >> a steam-powered blackberry. >> i don't think they're manufactured any more. >> i feel very safe with my blackberry. kelly is back with us monday. >> you have a good weekend as well. >> same to you. >> that is "closing bell." "fast money" begins right now. "fast money" starts right now. live from the nasdaq market site overlooking new york city's times square, i'm melissa lee. steve grasso, tim seymour, guy adami. a top analyst says apple is in for a lost decade. the man behind one of the most controversial calls on the street today will be here to explain. plus, billionaire steve schwartzman, speaking about president-elect trump's dream team of ceos this after trump warned companies about leaving the country. is trump a friend or foe of corporate america. and later, did you miss the trump rally? don't panic. we've got the one sector that could have you rolling in cash before the end of the year. we start off with the trump
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tech wreck. down more than 3%. underperforming the rest of the market. it's negative. and since -- check this out. the five biggest companies of the nasdaq 100 have lost a whopping $100 billion in market cap since trump was voted into office. now, these have been the hottest stocks all year. so is the trump tech wreck a buying opportunity at this point? guy adami, what do you say? >> hi. >> hi! >> i think there are three reasons why you have seen the soft in tech. the first reason is a stronger dollar. the second reason, equally so, has been this huge rotation into financials, into material stocks, out of tech that's been working for quite some time. i think the third reason, maybe a little more nebulous but almost as important, as interest rates have gone up, the need to own stocks with dividend yields have gone down, and a lot of these tech stocks have great yields. i think this selloff -- i think the selling will continue in a lot of these names. but there are certain names out
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there, if they get to levels -- for example, if cisco were to get to 27.5, extraordinarily interesting. intel, as well. inindividual i can't, which steve has been over for quite some time, now sold off over the last week. that probably has a little more room to the down side. that could be interesting. but to answer your question, i think the selloff can easily last for the next couple weeks. >> imbedded in this question, i suppose, if you believe that the trump rally continues, does that automatically mean it is a continuation of the rotation that we have seen. so more money out of financial -- out of technology. >> i don't think it has to mean that. >> okay. >> i think there's a couple -- you have to separate. tech is not trading as a monolith any more. they have buybacks and dividends. that trade is over. that is done. that's probably not coming back. but then you have to look at where the growth is on some of these. so you look at something like a microsoft. to me, that still looks interesting. they also have a lot of cash still overseas. so that could come back. that could be a special dividend like they have done in the past.
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so those are the type of names i would look at. the other i would look at is google. because i don't think -- i think actually what's going on on facebook could be a positive for google. you see more advertisers go over that. >> you look at a company growing earnings by 50% a year. i mean, facebook, it's an amazing story. trading at the cheapest pe it has since its ipo. 20 times next year's earnings. i look at facebook and say it's a stock that should be bought. when you talk to the core holders of facebook, we talk to the institutional holders, the institutional holders realize it is cheap, a bargain. they're not stepping in too buy stock here, because they have full position. the real question comes into play, who is the incremental buyer for these stocks, you know, as they continue to weaken. again, facebook, cheap. the stock is very, very cheap right here. >> the key is the rotation, when guy just started off the segment, the rotation, how long is that rotation going to last. what inning are we in that rotation. and no one on the desk, including myself, we don't really have a good feel for that. so if you tell me we're in the
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third inning, okay, let's give it a little more time to breathe. i don't know if we're in the third inning. i do know, s&p, if you look at the percentage of the s&p, as far as technology or financials or energy, you could start getting a handle on it. but what does that mean in the rear-view mirror? does tech go from 20% of the s&p to 18% of the s&p? do financials go back to 16 or 17? for me it's amazon. amazon is where you want to be. because amazon is going out for growth. you talk about growth for google, amazon is going to have that growth, as well. earnings, they could tweak it. they could tweak it february 2nd and catch everyone on their heels and amazon could explode to the up side. >> a lot of people have been on this network saying it's hard to pick the sectors at this point. put money into an s&p 500, etf or index fund, because the whole index is going to rise. let's say you want to play this -- take a look -- because a lot of people do play etfs, don't do individual stocks.
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technology versus financials. if you look at the forward pe of technology right now, 15.8. if you look at the forward pe of financials, 15. if you had to put money to work today, this is a version of "would you rather." would you rather. at this point in time, given the run we have seen in financials, given the rotation out of technology, and given the valuations. >> i think steve is probably with me on this. i would rather go back to tech at this point. i think financial -- listen, there's probably still a lot of room for financial. you have eight years of pent up demand, hostility. so there is definitely room. with that said, i think tech, financials here, if you're asking me what you just did, to flip the coin and pick, i'm picking tech. and specifically, on the back of this selloff. >> what do you pick? >> i think you go with tech. it's just the trading thing, right? you've already seen just a massive run in financials. so if i've got new money to put to work, why would i buy something at or near the highs when i can buy something that sold off for probably not that much of a fundamental reason. maybe just because they were
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used as a cash register. so for me, it's tech. >> yeah. i'm agreeing with him 100%. technology. look, i do believe the mid cap financials, let's say the mid cap banks in particular, will bode well into the end of the year. i think given the dislocation we have seen in tech, crm is a perfect example of the stock -- >> what does mid cap bank mean? mostly people think about large banks, regional banks. >> i should say -- let's be clear. regional banks in particular, i think bode well under this administration. >> right. >> i think those are the names you probably want to look at. >> some of the valuations now -- zion's bank shares, 27 right now. >> i'm with you on the regional banks, i think into the end of the year. those will be chased. i do believe you can push those around -- >> chased more than the overall, is that when the money center banks, they're more likely, more sensitive to have regulation not be -- >> i mean, listen. a lot of these things are priced for absolute perfection. every regulation is going to be reduced.
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>> i want to be clear. i said this. until the end of the year for a chase trade. the reason why, you still have massive -- incredible underweight, you know, in a lot of these portfolios. that's going to have to play catchup and that could last a lot longer than people anticipate. so that's my trade. i do believe that. i think technology, i agree with guy. 1,000%, crm looking extremely compelling. facebook the longer-term investor, cheapest pe we have seen. but i do believe near-term -- >> for all lovers of tech. all right. a major warning -- >> sell it. i mean -- everybody likes it. be on the same side of everybody. i still say buy. >> major warning to apple investors specifically for from one analyst. that's our call of the day. oppenheimer saying they're in for a decade-long malaise. andrew eric wits for services and technology. andrew, i think a lot of people think apple is in some sort of malaise. why is it a decade-long malaise?
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>> you look at the technology trends. the competition is not samsung, not the pixel phone. it's going to be facebook, google, ten-cent, who build cloud-based services, good engaging messaging apps and arrests official intelligence, which is going to make the hardware less important. and apple -- for apple, the hardware is the most important thing. >> so let me ask you this. a lot of people will make the argument, that apple could be a services company that transition hasn't happened yet. are they doing enough when they switch they are in competition with companies already building a services business? >> yeah, i mean, apple will probably try. i think they'll be behind. you know, apple is one of the first to come up with a great messaging app. now they're way behind everybody. they're the first with voice command. now they're way behind everybody. can't get sir re on third-party devices. you don't need to download apps any more to hardware. and that's the way it's going to be. that's apple's business. so unless they can do -- unless they can catch up rapidly, which
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i don't think they can, or have the courage to do so, i think we're going to be in a decade-long trade flat of round peak and nonpeak years of when the hardware gets redesigned. >> so you're not only making a commentary on the company, and i know this might sound, you know, pretty simplistic. but you're also making commentary on the stock. this stock has now been in a 15-momma lace, i can argue. peaked out at 132. middle of last year. give or take. so maybe it started that already. but can you see a scenario where technology-wise, they sort of lack innovation for the next -- but the stock gets its footing back. trump allows companies to repatriate dollars back. is there a scenario where the stock outperforms? >> i think there will be. i think -- and i actually think 17 could be an interesting year. because you have cash repatriation, a ten-year anniversary phone that can be radically redesigned. what we said in our note is, when you get to these radically redesigned years or get to an
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extra external driver like cash repatriation, it's probably going to outperform. and off years, i think it's an underperformer. so we're going to have these peak and troughs get exacerbated, more so than in the past. you don't have new territories to add in. no more new devices and so forth. >> andrew, we're going to leave it there. thanks for coming by. right here right now. >> i would buy it. and the setup in the 17, is great. aging install base and a redesigned phone coming out. that's the perfect sweet spot scenario just designed. my thought, you're going to trade probably up to 150 max. but i would have a full position on before the end of the year. >> peak units, peak margins. i say sell apple. and people used to hold on -- think about why you used to hold on to apple for the ecosystem. people so nervous about giving up their itunes library. so nervous about having all of their stuff on the phone. now you have streaming and competition. so when he was talking about google phone not being real
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competition, i do believe it's competition. i do believe that people don't want to pay premium prices for what they see as not a premium brand or the newest and hottest hardware out there any more. >> ten-year anniversary and a potentially curved screen this year. >> what? >> yeah. >> curved oled. organic light emitting. >> still have the flip phone. >> listen, i think -- i don't want to sell apple. you know, just trading wise, i would probably wait for it to sell off -- some real negative sentiment. last week we saw trouble with their supply chain, some names had sold off. so let that filter through. this is a 2017 story. so you'll get a chance to buy it. i just don't think today, right here, is the time to buy. >> coming up, want to get in on the trump rally? it's not too late. the traders tell you the best way to cash the way. and italy facing a crucial vote this weekend on its constitution, and one group of stocks could be the major loser. we'll tell you what they are. and donald trump creating a business capsule stocked with
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ceos. could the chair of the new counsel moments ago. will. >> i did, indeed, melissa. that man the chairman, be founder and ceo of blackstone group. we discussed whether the trump presidency and its new forum will be good for the economy and the markets. the highlight after the short break. can i have a 2017 lexus lx 570... yeah! wish big... at the lexus december to remember sales event. get up to $2,500 customer cash on select 2016 and 2017 models for these terms. see your lexus dealer.
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breaking news on president oba obama. seema mody. >> president obama has issued an executive order to block a chinese investment fund from buying the u.s. business of axe tron, citing risks to national security. ax tron, which does have assets here in the united states has said in the past if the -- the deal would be called off if president obama opposed it. it is a deal that is worth less than $1 billion, but the timing is interesting, melissa, given the wave of outbound chinese m & a we have seen in 2016. and is it a sign that washington is going to play a more pivotal role in cross-border m & a. >> all right, seema, thank you. let's be clear about this. this is a deal that was blocked on national security concerns, ax tron has a subsidiary in california. generates 20% of sales out of
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california and has a military application for its devices in satellite communications and radar. so that's the reason why he is doing this. >> you're probably going to see a lot more chinese m & a coming into the u.s. in 2017. i think that will be a theme, because that's how chinese companies are going to get the money out of the country. so not only are you seeing it on our side where there are social security concerns, you also saw the chinese government start to curtail that a bit. i city think in 2017 this will be a dominant theme. >> the president-elect creating a business advisory council stacked with ceos and steven schwartzman will chair the council. will. >> reporter: yes, indeed, melissa. he revealed he picked this new policy forum himself, and that donald trump had elected every name on the list. more broadly on the topic of whether donald trump's presidency is going to be good for business, schwartzman had this to say about the benefits of deregulation.
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>> right now, as a result of the regulation, u.s. banking system really is terrific. it's the best in the world. and it needs the freedom to start doing some things like making more loans. you can't grow unless your banking system is expanding and you're extending credit. we have been shrinking. so we sort of have -- with low interest rates, one foot on the gas and with regulatory overlay, one foot on the brake. and so what we're going to do is take off the full -- >> right. >> standing on the brake. >> of course, as we know, markets have already welcomed talk of potential deregulation from a president, donald trump. especially the banks. it was felt, though, yesterday in donald trump's carrier speech he has slightly offset that tone for business by making a veiled threat to businesses that
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suggested they might take workers outside of the united states. on that topic, schwartzman said it had been the first he had heard of the policy during trump's speech yesterday, and that we should probably get used to it. he said it's likely there will be a variety of things that will pop up that we and he are not expecting during the course of the presidency. steve schwarzman earlier saying this was a job he had taken motivated to help the country that he loves. guys? >> will, did he say what his first order of business would be, come february, or is that entirely up to the president-elect? >> reporter: well, i don't think it's an order of business. i think it's a case of advice and discussion amongst himself and all of these leaders. and that they're really at the beck and call of the president. some of the other interesting things that came up were, in fact, on the conflicts of interest, at which point he said it could take a while for trump to unwind his own conflicts of interest, because they're so intertwined and it's something he cares deeply about. so i don't think he knows what's on the agenda at the top of it.
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but i imagine there will be lots of conversations. he did reveal so far there has already been plenty of discussions between him and the president-elect. >> all right. will ford frost, thank you. willford with that exclusive from steven schwartzman. is donald trump a friend or foe of corporate america? can you imagine that conversation when that council meets in february? you've got mary barra of gm. doug mcmillan of walmart. you've got these companies that would be directly affected. if donald trump says there will be consequences for moving jobs overseas, all of these companies will be affected by that policy. >> i think when he says there will be consequences, that's the way you start off a negotiation to push people back on their heels. >> all right. >> and i think the conversation starts there. it's no different than any other president ever has done with corporate america. i think they start dialogue there. as strong as they can. and they hope they get back up whoever is on the other side and hope to meet somewhere in the middle where it pays for both sides. maybe i'm being optimistic
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about, but i truly believe. >> just yesterday, a lot of people were criticizing him with the carrier deal saying governments inserting themselves into private business and here we are. he is extolling private business by elevating these ceos to this advisory council. >> i think you keep your friends close, your enemies closer. ceos are looking at it from that perspective. they want to be tied in with him. he's the president. he wants to make sure he solidifies the jobs factor. ultimately in the long run that will be a positive. >> ultimately a friend, regardless of these smaller actions. >> ultimately, the jobs. the job growth is important. you talk about lending, et cetera. it's all an important component of this. i think he's -- you know, look, in the long-term, it's going to be a positive. coming up, a major vote ahead for italy. this will they join in on the populist movement. a special report from the ground in rome after the break. i'm melissa lee. you're watching "fast money" on cnbc, first in business worldwide. in the meantime, here's what else is coming up on "fast."
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♪ everybody was kung-fu fighting ♪ >> pretty much describes what's happened to health care stocks this week. now might be the time to buy. plus, crude has gone wild. but if you missed the move, there is still one more way to make money. and we'll explain. when "fast money" returns. ♪ ♪ is it a force of nature? or a sales event? the season of audi sales event is here. audi will cover your first month's lease payment on select models during the season of audi sales event. (bing) enjoy your phone! you too. all right, be cool. you got the amazing new iphone 7 on the house by switching to at&t... what??.... aand you got unlimited data because you have directv??
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welcome back to "fast money." i'm julia chattily here in rome, where last-minute campaigning is well under way ahead of this weekend's critical vote. what began as a referendum on constitutional reform streamlining the government here is now way bigger. why? because prime minister mat o-renzi offered to resign.
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a no vote means a period of political instability, and a critical time for the country's weak banks that have already been a concern for investors all year. you can see that. the bank index down almost 50%. if the no vote win, i think we could see yet more pressure on the banks on monday morning. but -- and it's a pretty big but -- there is always a risk of a surprise here. think donald trump, think brexit. in this case, the big surprise would be a yes win on sunday night, and if we get a yes win, then i think the opposite. we could see a pretty big risk rally in the banks on monday morning. melissa, those are your two scenarios. back to you. >> all right. thank you very much, julia. with all eyes on italy this weekend, what do we trade today, and i saw this and i was sort of surprised, because the banks were obviously the italian banks, very worried about this, of course. >> >> and rightly so. >> but there was a bid for italian bonds. >> so the theory being that if anything bad did happen, the ecb
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is going to step in and buy bonds, right? so you can look at it on sunday night. not much to do now. sunday night, watch the euro. if you see this reaction and you see a no vote and the euro starts going lower, that's an indication, the ecb will be in monday morning buying bets. >> is that something you're worried about? >> i think no is basically, in my opinion, u.s. banks and how they would be affected priced in. i think people anticipate it. the risk is to the up side. what happens to a risk from a risk-on perspective. i do believe a no vote -- i do backup bk on that. >> shifting from the political climate to the climate in the northern hemisphere, according to the weather network, winter officially arrived yesterday. it was a meteorological, if i can say that, start of winter, the technical term for the start of the coldest stretch of the year. everyone following along? so in lieu of the final trade, go around the horn for stocks that will get cold in the next three months.
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grasso. >> apple. everyone talks about peak everything. it's going to be apple. apple is going into a freeze right now. apples don't taste great when frozen. >> a ten-year freeze? >> i don't think a ten-year freeze, but i think the best days are probably behind apple. people looking for value. so be careful about shorting the stock. but i would not get long. >> i'm going to talk about a stock down 72% year-to-date and going lower. a $1.8 million market cap company. f fitbit, f-i-t. i consider this being a billion dollar market cap sooner than later. user engagement is lousy. a stock you want to sell. >> beakers? >> going into winter, something is going to freeze over. i think it's going to be the retailers, in particular walmart. got a boost this week, stealing share from dollar general, but the macro environment doesn't look good. >> i'm with bk on the retail front.
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jw nordstrom has had a tremendous move over the last six months. but it's too much. valuation is too rich jwn, sold to you, mel. >> that does it for us here on "fast." see you back here on monday at 5:00. a big "options action" starts right after this. ♪ you never take advice a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley if you're going to wish, mommy, yourwish bigme true! at the lexus december to remember sales event. get up to $2,500 customer cash on select 2016 and 2017 models for these terms.
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see your lexus dealer.
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we're back! guess who we missed the most. carter braxton. while the guys are getting ready, here's what's coming up on the show. >> visa, it's everywhere you want to be. >> and maybe some places you don't. like your portfolio. because something is happening in the charts that suggests visa is going lower. we'll give you the trade. and big money in big oil. >> i'm going to have more money than you ever thought you could have! >> if you missed the move in oil this week, we'll tell you how you can still profit. we'll break it down. plus, is it time to bet the farm on a


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